Doing Nothing to Plan Ahead for Long Term Care Costs

Today’s blog post continues the series about possible ways to plan ahead to protect against long term care costs.

Previously, my blog discussed giving money away as a method to plan ahead for protection against long term care costs.  My post of September 19, 2014, the first installment of the discussion on gifting, described how the Medicaid “Aged, Blind and Disabled” program and the Department of Veterans Affairs “Pension” (aka VA “Aid and Attendance”) program look at assets given away.  My post of September 25, 2014 discussed transferring assets to a trust for protection against long term care costs.  My post of October 2, 2014 discussed transferring assets to a Limited Liability Company for protection against long term care costs.  My post of October 9, 2014 discussed transferring assets to your children (or other family members) for protection against long term care costs.  My post of October 16 discussed transferring assets to a charity as a way to protect against long term care costs.  My post of October 23, 2014 discussed transferring assets to your spouse as a way to protect against long term care costs.  My post of November 26, 2014 compared the various gifting strategies.

Before that, my blog discussed long term care insurance as an approach to planning ahead for long term care costs.  In the long term care portion of this discussion, my post of May 22, 2014 discussed whether to buy long term care insurance at all.  My post of May 29, 2014 suggested looking for a stable, proven insurer.  My post of June 5, 2014 described how to identify a proven, stable Long Term Care insurance company.  My post of June 12, 2014 discussed the importance of protection against inflation. My post of June 19, 2014 suggested planning to use insurance to pay for four or five years of long term care.  My post of June 22, 2014 suggested a daily rate to choose when purchasing long term care insurance.  My post of July 10, 2014 advised to look carefully at the list of Activities of Daily Living that can trigger coverage from the long term care insurance policy.  My post of July 17, 2014 described the differences between a “period of time” kind of coverage and a “pile of money” kind of coverage.  My post of July 25, 2014 advised to make sure that the long term care insurance includes coverage for cognitive impairment.  My post of July 30, 2014 described the differences between tax-qualified and non-qualified policies.  My post of August 5, 2014 discussed the value of long term care insurance policies that qualify for the Partnership program.    My post of August 14, 2014 discussed hybrid policies that combine long term care insurance with life insurance.  My post of August 21, 2014 described how a long term care insurance policy with a return of premium rider can be used to construct a “hybrid” life insurance/long term care insurance policy.  My post of August 28, 2014 described how to use a partnership policy to protect just enough of your life savings while holding down the cost of the insurance.  My post of September 5, 2014 described how to coordinate long term care insurance with potential veterans benefits.  My post of September 12, 2014 discussed how an elder law attorney can help maximize the value of long term care insurance.

The introductory post in the series on planning ahead for long term care costs appeared on May 15, 2014.

Today’s post discusses doing nothing to pre-plan for long term care costs.

It’s okay to do nothing to protect your assets against the possibility of long term care costs in the future.  It’s easy.  It doesn’t cost anything.  It doesn’t give your money away while you’re still healthy.

Doing nothing does have a high degree of risk, however. To decide to do nothing you must determine whether you’re “losing sleep” about the risk of long term care in your future.  If you’re aware of the possibility of long term care needs in the future but that awareness doesn’t cause you to worry, then doing nothing is okay.  (Doing nothing through procrastination or decision-making inertia is NOT the same as determining how worried you are about long term care in your future.)

Doing nothing is especially okay if the cost of long term care insurance would bother you or the inconvenience and loss of control of your money that comes from giving away substantially all of your assets would bother you.

I can’t stress enough, however, that doing nothing is risky. (I know I’m repeating myself, but that is probably the most important thing to know about doing nothing to plan ahead.)

Even if you do nothing to plan ahead for long term care costs, there is the possibility of crisis planning at the time you need long term care that can allow you to keep some of your assets in the family (or wherever you want your assets to go.) Crisis planning won’t save nearly as much as pre-planning would have saved, but it will probably save something.

For more information, visit Jim’s website.

Jim Koewler’s mission is
“Protecting Seniors and People with Special Needs.”

For help with long term care or with planning for someone with special needs,
call Jim, or contact him through his website.

© 2014 The Koewler Law Firm.  All rights reserved.

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